The week in emerging markets, with our most read stories, five things we have learned, and the week in a chart – this week: EM reacts to Bernanke
Five things we have learned:
The week in one chart: EM reacts to Bernanke comments that an end of quantitative easing could finally be in sight
It’s all about context. EM equities sold off on Thursday following relatively hawkish comments from Ben Bernanke, chairman of the Federal Reserve, that an end of quantitative easing could finally be in sight. Sluggish manufacturing data from China didn’t help sentiment either.
Hong Kong’s Hang Seng index was among the biggest losers – down 2.5 per cent on Thursday. But at 22,618.67, the index is still trading at a two year high – a sign that momentum is still on the EM bulls’ side – for now anyway.
Mexico was one of investors’ favourite emerging markets last year.
Foreign investors poured a record $73.2bn into Mexican bonds and stocks in 2012 – a 60 per cent jump from the year before. Given the momentum behind the country, few at the start of this year would have dared to predict that the inflows would slow.
They were wrong. Continue reading »
Earlier this week, Banco do Brasil called a relative of mine to offer her an “opportunity to change her life” – a payroll loan. This is a form of credit whose repayments are cut directly from your pay packet every month.
The only problem was, Banco do Brasil did not do its homework. This would-be borrower is a student and doesn’t earn an income. The anecdote shows the length that banks in Brazil are going to in order to continue the country’s credit-driven economic miracle. Continue reading »
Suspecting that the minerals and metals trade was funding conflict in eastern Democratic Republic of Congo, the US Securities and Exchange Commission adopted Section 1502 of the Dodd Frank Act last August, requiring US-listed companies operating in the region to carry out checks on their supply chain for commodities including tin, tantalum, and gold.
This week, five months into the first reporting year of the law, a US House of Representatives’ subcommittee on monetary policy and trade heard ‘for and against’ testimony about the impact of Section 1502 so far. Continue reading »
When Russia’s Communist party called for a Moscow street to be named after Hugo Chávez in March, the city authorities refused on grounds that the former Venezuelan leader had not been dead long enough to qualify for the honour. However, in a sign of the importance Russia attaches to Venezuelan relations, Igor Sechin, the powerful chief executive of Rosneft, wants Moscow to waive the rules. Visiting Caracas this week to finalize a big oil deal, Sechin said a Chávez street should indeed be added to the map of the Russian capital. Continue reading »
Some 6 per cent of India’s population lives in slums and these communities have become powerful, both economically and politically. The slum dwellers’ low-end aspirational consumption could now be propping up certain sectors as demand wanes elsewhere.
As a first-time visitor with a textbook image of a slum in mind, standing at Mumbai’s Mahim train station at the threshold of Dharavi, one of Asia’s largest slums, you might expect some demarcation between the formal and informal world. Continue reading »
Polish retail sales slumped in April according to figures released on Friday, falling by an annual 0.2 per cent, worse than consensus which had been for a 1.1 per cent increase, in yet another indication of the severity of the slowdown hitting the Polish economy. Continue reading »
* BoJ governor Haruhiko Kuroda promises to stabilise bond market
* G8 and G20 focus on tackling tax avoidance
* China clears Boeing’s Dreamliner for commercial domestic flights Continue reading »
A note from Capital Economics on Friday suggests the economies of central and eastern Europe may finally be emerging into the light.
Or at least its title does (Emerging Europe: Slump in regional growth may be bottoming out). Its message, though, is that while recent GDP figures may have given grounds for that kind of hope, growth is extremely weak and any recovery is likely to be sluggish and uneven. Continue reading »
Friday’s picks from beyondbrics: corruption scandals rock big-money IPL cricket; China’s regulatory crackdown; SAB Miller proves to be the toast of EM drinkers, and Heineken is playing catch-up; Georgia’s fragile democracy. Plus, Russia’s Asian gas gamble. Continue reading »
The latest weekly figures from EPFR, the Boston-based watcher of global fund flows, give us a snapshot of market sentiment in the days running up to Ben Bernanke’s comments on Wednesday, suggesting an end of quantitative easing could finally be in sight.
They show that investors were feeling relaxed and comfortable, even as rising yields on US Treasuries pushed up yields on emerging market debt and as EM equities remained under pressure. Will that mood last? Continue reading »
* Vedanta sells India’s largest ever offshore bond
* Chinese solar companies seek EU and US tariff deals
Worried about the slowdown in the Chinese economy? Or Beijing’s austerity drive? Lane Crawford, the iconic Hong Kong purveyor of luxury brands, is not.
It says the time is just right to open a shop in Shanghai which, at 150,000 square feet, is twice the size of any other Lane Crawford store anywhere. It will open in September. Continue reading »
One of my first memories of using mobile phones in Brazil was making calls from the top of a mango tree.
This was in the 1990s, a time when cellphones were still relatively rare. And during holidays on the family farm in the middle of the country, that mango tree was the best place to find reception. Continue reading »
On Latin America’s Pacific rim, deepening free trade appears to be the name of the game, as the region’s pro-markets countries of Mexico, Colombia, Peru and Chile – have agreed to drop most tariffs to speed the consolidation of the Pacific Alliance.
At least, that is what Colombia’s President, Juan Manuel Santos, told beyondbrics on the sidelines of the group’s latest summit in the Colombian city of Cali on Thursday. Continue reading »